Would Donald Trump’s trade tariffs hurt Europe?

The EU is increasingly reliant on the US export market, making it vulnerable to the potential shocks of Trump’s trade policy.

Transcript

00:00Would Donald Trump tariffs hurt Europe?

00:05We got to use tariffs very, very wisely.

00:10That's why you need tariffs.

00:13It's the most beautiful word there is, tariff.

00:15A 20 percent tariff on all products imported into the U.S.

00:20It's one of Donald Trump's boldest policy proposals and potentially the most consequential

00:25for Europe.

00:27Trade in goods and services between the EU and the U.S. is worth around 1 trillion euros

00:33per year, making it the most valuable trading relationship in the world.

00:38The EU benefits from a trade surplus in goods of 156 billion euros last year.

00:44But Trump's tariffs would make it more expensive for U.S. companies to import European products,

00:50causing EU exports to the U.S. to potentially collapse.

00:54Economists estimate Trump's policies would lower the eurozone's growth by as much as

00:591.5 percent by 2028, pushing it to the brink of recession.

01:06Germany's already ailing industry would be expected to take the hardest hit, as its cars

01:12and pharmaceutical industries are especially reliant on U.S. exports.

01:17Trump's plans to slap higher tariffs of as much as 60 percent on China could also lead

01:23to more Chinese exports being dumped in Europe.

01:26But could the EU negotiate an exemption?

01:30Experts say it's possible.

01:31The EU and others will be keen to offer Trump a carrot, you know, something to give him

01:39the facade of saying that he's gotten away with a huge success.

01:43There's also a real possibility Trump would roll back on his tariff threats to avoid spiking

01:49inflation and for fear the cost of his tariffs would be passed on to American consumers.